Business Risk , refers to the certainty of operating income caused by products, customers, machinery and the way production takes place. Select one: True False
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Business Risk , refers to the certainty of operating income caused by products, customers, machinery and the way production takes place.
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- Which of the following does not describe a management control system? A. establishes a companys strategic goals B. implements a companys strategic goals C. monitors a companys strategic goals D. a system that only measures profitabilityDefine operating leverage and explain its importance to a company and how it relates to risk.A process that create a financial position that offsets the risk of an ongoing business process is which method of handling risk? Transfer the risk Keep the risk Avoid the risk Mitigate the risk
- What is the importance of forecasting revenue and cost in the business?A. Operating expenses are a function of: a. The cost of equity and the cost of debt b. The interest rates on debt and the amount of debt c. Design(s) of the value propositions, the skill level and processes for spending money to operate the company, and the loan term bond yield + the equity risk premium + risks specific to the company d. Design(s) of the value propositions, processes used to produce the value proposition(s), and the skill level and processes for spending money to operate the company B. Which of the following is most closely associated with margin as a %? a. Sales revenue b. The processes used to produce the company’s value proposition(s) c. The proportion of debt and equity in the company’s capital structure d. The average operating assets of the company C. Which of the following is most closely associated with asset utilization? a. The cost of equity b. Expenses c. Operating assets…_______________________________ is generally referred as a parameter to check/test the efficiency of the business concern. Select one: A. Assets B. Liabilities C. Profit D. Capital
- Which of the following best describes the potential impact of business risk on Earnings Quality? Select one: a. Business risk is mostly composed of financial risk factors and it has minimal effect on earnings quality. b. Higher earnings quality is linked with companies more insulated from business risk. While business risk is not primarily a result of management’s discretionary actions, this risk can be lowered by skillful management strategies.' c. A higher level of earnings quality can be observed in the industries with high business risk, because higher risk means higher returns d. For managing business risk, the managers almost have no discretion, therefore business risk is not directly or indirectly related to earnings quality.Management accounting reports on the profitability (and therefore the efficiency) of a business, whereas financial accounting reports om specifically what is causing problems and how to fix them. True or false?Managerial accounting produces information: a.to meet the needs of investors b.to meet the needs of external users c.that follows the rules of GAAP d.that is often focused on the future
- Who are the primary users of a company's management accounting information? A its customers to understand the pricing of the product. B its creditors to understand the credibility of the business. C its employees to plan and control operations. D its investors to make their investment decisions.Discuss the benefits of managing financial risks in a company?What is the normal sequence in performing top down security analysis? A-competition, consumer demand, threat of substitute products B-market conditions, risk, company fundamentals C-economy, industry, company D- proftability, efficiency, liquidy
